Inventories

3 Months Ended

Oct. 31, 2024

Inventories consist of the following at:


	October 31, 2024		July 31, 2024
Raw materials and components	$	74,920,000	72,820,000
Work-in-process and finished goods	37,330,000		38,587,000
Total inventories	112,250,000		111,407,000
Less reserve for excess and obsolete inventories	30,446,000		18,271,000
Inventories, net	$	81,804,000	93,136,000

As of October 31, 2024 and July 31, 2024, the amount of inventory directly related to long-term contracts (including contracts-in-progress) was $3,021,000 and $2,869,000, respectively, and the amount of inventory related to contracts from third-party commercial customers who outsource their manufacturing to us was $2,098,000 and $2,204,000, respectively.

As discussed in Note (1) – General – Liquidity and Going Concern, in connection with our initiatives to transform our Company (e.g., reevaluating our business plans to identify opportunities to focus future investment on our most strategic, high-margin revenue opportunities), during the three months ended October 31, 2024, we recorded a non-cash charge of $11,369,000 within Cost of Sales on our Condensed Consolidated Statement of Operations. Such non-cash charge primarily related to the write down of inventory associated with approximately 70 products within our satellite ground infrastructure product line that were either discontinued or being de-emphasized going forward. As discussed in Note (2) – Business Divestitures, such non-cash charge also included the write down of inventory associated with the CGC Divestiture, which was determined during the first quarter of fiscal 2025 to no longer be salable.

In the first quarter of fiscal 2025, we also expensed $1,082,000 of work in process inventory related to certain loss contracts in our satellite ground infrastructure product line accounted for under the point in time revenue recognition model.